Home Loan FAQs
Your Home Loan eligibility depends on various factors like age, income, debt repayment history etc. The eligibility criteria differ from bank to bank. But, before you decide on the loan amount, it’s smart to evaluate your current financial situation and determine how much money you can comfortably shell out each month.
Keep these documents handy before applying for a Home Loan:
- Photo ID and age proof
- Residence proof
- Bank statement from the last six months
- Property documents
- Salary slips (last three months)
- Form 16
- Income Tax returns for the last three years with income computation
- Balance sheet and Profit and Loss account (CA certified or audited) for the last three years
Personal Loan FAQs
A Personal Loan is an unsecured loan that is given by banks or a Non-Banking Financial Company (NBFC). This is an unsecured loan which means you don’t have to provide the lender with any collateral like property/gold to avail it. This type of loan is taken to fulfill your personal needs.
Well, this totally depends on the bank. The minimum amount that can be borrowed will also vary from bank to bank. However, you can avail a Personal Loan for a minimum amount as low as Rs. 10,000.
Again, this amount will vary from each lender. But most banks will provide you a loan for up to Rs. 40 lakhs. This will also depend upon the applicant based on their credit history, income and repayment capacity.
The tenure for repayment is generally set from 1 – 5 years.
- Photo ID and age proof
- Signed Application form with a photograph
- Residence proof
- Bank statement from the last six months
The above are the general documents. However, if you are salaried, then you need to provide these as well:
- Salary slips from the last three months
- Form 16 or your Income Tax returns
A processing fee is a charge that you will have to pay when your loan gets disbursed. Usually, it is a fixed sum or a small percentage of the entire loan amount. Most banks are transparent about these fees and you can find out about it by checking the loan details before applying for it.
Repaying your loan before the tenure is called pre-payment. Whenever a customer is ready and willing to repay their Personal Loan, they can do so by intimating the bank about their wish.
Some banks levy pre-payment charges on Personal Loans. It can either be a standard amount or a percentage of the total loan amount. This will depend on the bank and its policies.
For starters, this is not the best way to go forward once you’ve taken a Personal Loan. However, if you do default on your loan for whatever reason, there will be consequences. The most damaging one will be to your credit history and it will affect your Credit Score. And when your Credit Score dips, you will not be considered for loans or Credit Cards in the future. Even banks blacklist customers who have defaulted on loans or who have a very low Credit Score.
Business Loan FAQs
Whether your business is at an initial stage or in the growth phase, additional finance can help you keep up the momentum. You can avail a business loan for your short or long term financial needs, to avoid any type of working capital shortfall. Also you can get business loan without providing any collateral security.
From one bank or NBFC You can avail of a loan from Rs 100,000/- to Rs 50,00,000/- depending on your income, repayment capacity and respective location capping. However, the aggregate loan amount can be in excess of Rs 2 crores* for a Company.
To obtain the loan, there is absolutely no need to provide any security or collateral.
You can repay your loan over a period of 12 to 36 months.
We offer Business Loans to both professionals and non-professionals, who are self-employed. These loans are approved quickly and are available at competitive interest rates.
The customer segments covered under Business Loans are listed below:
- Sole Proprietorship
- Partnership Firm
- Private Limited Companies
- Hospitals, Nursing Homes, Diagnostic Centers, Pathological Labs.
Loan against Property FAQs
Any loan against a residential or commercial property can be used for both personal and business purposes. In fact, you can use it for anything other than speculative or non-prohibitive activities.
Basically, the bank looks at your repayment capacity. For calculating the loan amount, your income, age, qualifications, spouse’s income, assets, liabilities, stability and continuity of occupation and savings history are taken into consideration. However the eligibility of loan does not, generally, exceed 65 percent of the market value of the property.
You can include your spouse as a co-applicant and that results in a higher amount being lent. However, if the property is co-owned, all co-owners mandatorily need to be co-applicants. Sometimes group companies are also taken as co-applicant to increase loan eligibility.
Processing fee for loan against any property varies from bank to bank and is generally around 1 percent.
Loan against property generally has a maximum tenure of 15 years, subject to the condition it does not exceed your retirement age. This condition however can be flexible in certain cases.
As the name implies you need to mortgage your property for availing this loan.
Please do ensure that the title to the property is clear, marketable and free from encumbrance. To elaborate, there should not be any existing mortgage, loan or litigation which is likely to affect the title to the property adversely.
Yes. Prepayment is possible however generally there are prepayment charges applicable, which varies from bank to banks.
Education Loan FAQs
Education loans are offered by banks to students to enable them to pay for higher studies such as graduation and post graduation courses, both in India and overseas. Apart from the tuition fees, other aspects of expenses such as hostel charges, equipment purchases and other course related expenses may also be covered by the education loan. In case of overseas studies, many education loan providers include the price of a return ticket into the education loan corpus.
As most students have no previous credit history, the parent or guardian has to co-sign for an education loan as a guarantor. Moreover, education loans also require collateral such as property documents, fixed deposits, etc. Though there is an interest free (moratorium period) for an education loan, if you service the interest accrued on an education loan during the period, you may receive a further discount on the education loan.
Every bank has its own eligibility criteria for dispensing education loans, but a few common parameters are:
- Applicant should be an Indian national.
- Applicant should have confirmed admission in a college/educational institution at the time the loan application is made.
- Applicant should be in the age bracket 16–35 years.
- The Applicant should have a co-borrower such as a parent who acts as guarantor for the loan
- Collateral in the form of a property or fixed deposit etc. is required for loan amounts higher than Rs. 4 lakhs.
Documents that are to be submitted with the education loan application include:
- Admission confirmation letters and papers validating any scholarships the applicant has qualified for.
- Schedule of expenses for the course including tuition fees and other expenses.
- Score sheet of qualifying test(s).
- Copies of foreign exchange permit/student visa for overseas studies.
- Bank account statements for last 6 months. (Can be a joint account with parent/guardian)
- Statement of assets and liabilities of borrower.
- Proof of age
- Proof of residence
- 2 passport size photographs
- Documents related to collateral required for education loans exceeding Rs. 4 lakhs.
Yes, for all full-time courses a co applicant is required. The co-applicant can be Parent/Guardian or Spouse (if-married).
The tuition and hostel fees are disbursed directly to the institute as per their schedule and fee structure usually in the form of a draft. Other components of the loan such as course-related expenses for lab equipment, laptop computer, uniform, travel expenses etc. may be claimed by and provided to the loan applicant.
Each student is given some time by the bank before the repayment tenure starts. This is the time granted by the lender before the repayment begins is referred to as the holiday period. It is usually either 6 months to 1 year after the successful completion of the course, or the time it takes the borrower to start working at a job, whichever is earlier.
Loan borrowers can avail tax benefits on interest paid on education loan under Sec 80E of the Income Tax Act. This benefit is available over and above the Rs. 150,000 deduction allowed under Section 80C. Tax benefits can be availed once the borrower starts paying the interest on the education loan. Further, the deduction is available until the borrower pays off the full interest amount on the loan or for a maximum period of 8 years, whichever is earlier.
Most banks do not levy prepayment penalty on education loan. However, it is best to check with the bank before signing the dotted line.
Do banks offer an education loan in foreign exchange? I need to pay in dollars for my studies, but the bank is in India.
The loan availed by the student is paid to the educational institution directly in the local currency (Dollar/Pounds/Euro etc.). The lender may charge an additional currency conversion fee as per RBI regulations on the loan amount disbursed.